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Effect of foreign ownership on cost of borrowing
This article draws upon a sample of more than 27,000 Chinese small and medium-sized enterprises (SMEs) to explore whether and how foreign equity investment in local SMEs affects the cost of debt. The results show that foreign ownership lowers the cost of borrowing for Chinese SMEs, and that this eff...
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| Format: | Article |
| Language: | English |
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2014
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| LEADER | 01131nab a22001817a 4500 | ||
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| 008 | 160615b2014 xxu||||| |||| 00| 0 eng d | ||
| 100 | |a Chen, Dong | ||
| 245 | |a Effect of foreign ownership on cost of borrowing |c Evidence from small and medium-sized enterprises in China / | ||
| 260 | |c 2014 | ||
| 300 | |a 693 - 715 | ||
| 520 | |a This article draws upon a sample of more than 27,000 Chinese small and medium-sized enterprises (SMEs) to explore whether and how foreign equity investment in local SMEs affects the cost of debt. The results show that foreign ownership lowers the cost of borrowing for Chinese SMEs, and that this effect is stronger in more developed provinces. These findings contribute to evidence regarding the halo effect of foreign direct investment in emerging markets. This study also expands pecking order theory by demonstrating the signalling effect of equity structure characteristics on debt financing. | ||
| 650 | |a Signalling | ||
| 650 | |a Small Business | ||
| 650 | |a Foreign Ownership | ||
| 650 | |a Cost Of Debt | ||
| 650 | |a China | ||
| 773 | |a International Small Business Journal |d September | ||
| 999 | |c 41952 |d 41952 | ||